Elon Musk, the CEO of Tesla, bought a 9% interest in Twitter, making him the social media platform's largest shareholder at a time when he is questioning the platform's commitment to free expression and the First Amendment.
The eventual goal of Musk's $3 billion stock purchase of 73.5 million shares is unknown. Yet, in late March, Musk, who has 80 million Twitter followers and is a frequent user of the website, questioned whether Twitter's free speech is hurting democracy.
It's unknown when Musk purchased the stock. The event that triggered the submission, according to a Securities and Exchange Commission document made public on Monday, occurred on March 14.
Musk has, however, discussed the notion of creating a rival social media network in front of his enormous and devoted Twitter following.
Industry observers and legal experts doubt that the unpredictable CEO will stay out of the spotlight for long. If Musk so desires, he could start pressing for reforms at Twitter right away.
Although Musk's intentions are unclear, CFRA Analyst Angelo Zino noted in a note to investors that Twitter could be seen as an acquisition target because its stock price has been declining since early last year.
In November, Jack Dorsey resigned as CEO. Musk's Twitter investment is more than four times larger than Dorsey's, who co-founded the firm and was the company's largest individual stakeholder until Musk came.
"Musk's actual stake is a very small percentage of his fortune, and an all-out buyout should not be ruled out," Zino, a Twitter and social media journalist, stated.
According to Erik Gordon, a law and business professor at the University of Michigan, Musk could regard Twitter as an investment with significant growth potential, or he could be buying for non-financial reasons, such as ensuring that the network does not restrict his speech.
"What he might be afraid about is Twitter saying, 'We're doing our job against disinformation,' if enough of his tweets start to seem like disinformation." Gordon remarked.
According to Musk, no CEO would refuse a call from the company's largest shareholder, therefore the purchase provides him access to Twitter's senior management.
Musk has not stated how he plans to amend Twitter's rules, but the social media platform's history of suspensions and bans is widely known.
Following the Jan. 6 Capitol riot, which critics accused him of encouraging, former President Donald Trump was banned from Twitter and other major social media platforms. The restriction has generated challenging questions about free speech in a social media market driven by a few tech behemoths, a subject that Trump and the right-wing media have exploited.
Musk sold more than 15 million shares for a total of $16.4 billion. Musk is close to selling 10% of his stock after some sales in late December.
Musk's disclosure about his Twitter stock came just two days after Tesla Inc. released its first-quarter delivery figures. The company supplied 310,000 vehicles throughout the time, which was significantly less than expected.
From Providence, Rhode Island, Matt O'Brien and Michelle R. Smith contributed. Krisher contributed reporting from Detroit.
